Peach growing is perfectly competitive. For simplicity, suppose that all peach + growers have the same cost curves. In the adjacent figure, each grower's initial A peach grower's cost curves average total cost curve is ATC, its initial marginal cost curve is MC, and its long-run average cost curve is LAC. $50- MC Suppose the price is $40 per bushel and the firm stays open. ATC Ad $40- In the short run, the firm's profit-maximizing price is $ 40 and the profit-maximizing quantity is 7000 bushels. $30- Price and cost ($/bushel of peaches) The firm is making an economic profit . $25- $20- Firms will enter the market. $10 In the long run, the price will If there are no technological e long run will be $ $0- 2,000 4,000 6,000 8,000 10,000 Quantity (thousands of bushels of peaches per year) not change rise fall